State Department Awards $268M for Honduras Embassy Construction to BL Harbert International
Contract Overview
Contract Amount: $268,215,569 ($268.2M)
Contractor: BL Harbert International LLC
Awarding Agency: Department of State
Start Date: 2018-09-23
End Date: 2023-08-01
Contract Duration: 1,773 days
Daily Burn Rate: $151.3K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 2
Pricing Type: FIRM FIXED PRICE
Sector: Construction
Official Description: CONSTRUCTION SERVICES FOR NEW EMBASSY COMPOUND (NEC) IN TEGUCIGALPA, HONDURAS.
Plain-Language Summary
Department of State obligated $268.2 million to BL HARBERT INTERNATIONAL LLC for work described as: CONSTRUCTION SERVICES FOR NEW EMBASSY COMPOUND (NEC) IN TEGUCIGALPA, HONDURAS. Key points: 1. Significant investment in diplomatic infrastructure abroad. 2. BL Harbert International is a major player in large-scale construction. 3. Potential risks include geopolitical instability and construction cost overruns. 4. The construction sector is experiencing high demand and material costs.
Value Assessment
Rating: fair
The contract value of $268M is substantial for embassy construction. Benchmarking against similar projects is difficult without more granular cost data, but the scale suggests a complex undertaking.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
Full and open competition was utilized, which is ideal for price discovery. However, the long duration and fixed-price nature could lead to contractor risk if costs escalate beyond initial estimates.
Taxpayer Impact: Taxpayer funds are being used for critical diplomatic infrastructure, aiming for long-term value and security.
Public Impact
Enhances U.S. diplomatic presence and security in Honduras. Supports local employment and economic activity during construction. Represents a long-term commitment to international relations.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Long project duration increases risk of cost escalation.
- Geopolitical factors in Honduras could impact project.
- Fixed-price contract may not account for unforeseen material cost increases.
Positive Signals
- Full and open competition promotes best value.
- Embassy construction is a critical national security asset.
- Experienced contractor selected.
Sector Analysis
Embassy construction falls under the broader commercial and institutional building sector. Spending benchmarks for such projects are highly variable due to location, security requirements, and scale.
Small Business Impact
The contract was awarded to BL Harbert International, a large prime contractor. There is no indication of small business subcontracting in the provided data, which could be an area for improvement.
Oversight & Accountability
The Department of State is responsible for oversight. The long duration and fixed-price nature necessitate diligent monitoring to ensure adherence to scope and budget.
Related Government Programs
- Commercial and Institutional Building Construction
- Department of State Contracting
- Department of State Programs
Risk Flags
- Potential for cost overruns due to fixed-price contract and long duration.
- Geopolitical instability in Honduras could impact project timeline and safety.
- Lack of explicit small business participation noted.
- Dependency on a single large contractor for a critical asset.
Tags
commercial-and-institutional-building-co, department-of-state, definitive-contract, 100m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of State awarded $268.2 million to BL HARBERT INTERNATIONAL LLC. CONSTRUCTION SERVICES FOR NEW EMBASSY COMPOUND (NEC) IN TEGUCIGALPA, HONDURAS.
Who is the contractor on this award?
The obligated recipient is BL HARBERT INTERNATIONAL LLC.
Which agency awarded this contract?
Awarding agency: Department of State (Department of State).
What is the total obligated amount?
The obligated amount is $268.2 million.
What is the period of performance?
Start: 2018-09-23. End: 2023-08-01.
What specific cost controls and contingency plans are in place to manage potential overruns given the project's duration and fixed-price nature?
The contract's fixed-price structure implies the contractor bears the risk of cost overruns. However, effective oversight by the Department of State is crucial. This includes monitoring material price fluctuations, labor costs, and potential delays. Contingency plans might involve change order management processes and regular progress reviews to identify risks early.
How does the Department of State assess the long-term value and security benefits of this new embassy compound against its significant cost?
The value is assessed based on enhanced diplomatic capabilities, improved security for personnel and classified information, and the symbolic representation of U.S. commitment. The long-term benefits are expected to outweigh the initial investment through more efficient and secure diplomatic operations, reduced maintenance on older facilities, and fostering stronger bilateral relations.
What measures are in place to ensure the construction process minimizes disruption and maximizes positive economic impact in the local Honduran community?
Measures likely include adherence to local labor laws, sourcing local materials where feasible, and implementing environmental and safety standards. Positive economic impact is generated through direct job creation for local workers and indirect support for local businesses supplying goods and services. Minimizing disruption involves careful site management and community engagement.
Industry Classification
NAICS: Construction › Nonresidential Building Construction › Commercial and Institutional Building Construction
Product/Service Code: CONSTRUCT OF STRUCTURES/FACILITIES › CONSTRUCTION OF BUILDINGS
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: TWO STEP
Solicitation ID: 19AQMM18R0003
Offers Received: 2
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Address: 820 SHADES CREEK PKWY STE 3000, BIRMINGHAM, AL, 35209
Business Categories: Category Business, Limited Liability Corporation, Not Designated a Small Business, Partnership or Limited Liability Partnership, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $268,215,569
Exercised Options: $268,215,569
Current Obligation: $268,215,569
Subaward Activity
Number of Subawards: 210
Total Subaward Amount: $72,122,759
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Timeline
Start Date: 2018-09-23
Current End Date: 2023-08-01
Potential End Date: 2023-08-01 00:00:00
Last Modified: 2025-05-13
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